this link http://www.hussmanfunds.com/html/fedirrel.htm
states "Activist monetary policy is based on the assumption that there is a predictable relationship between bank reserves and bank lending. The operative notion of easy money is that the Fed creates new bank reserves, and banks lend them out. These loans get spent, and the proceeds get deposited at other banks as new checking accounts. Whatever is not required to be held as reserves is then lent out again, and through the magic of the “money multiplier”, loans and bank deposits go up by many times the initial injection of reserves.
That’s the theory. But a change came in the 1970s with the emergence of money market funds, which require no reserve requirements. Then in the early 1990s, reserve requirements were dropped to zero on savings deposits, CDs, and Eurocurrency deposits.At present, reserve requirements apply only to “transactions deposits” - essentially checking accounts. The vast majority of funding sources used by banks to create loans have nothing - nothing - to do with bank reserves."
this information “the inflation is two-fold. Firstly, the Fed pushes new reserves into the system via the OMOs in order to try to bring the FFR down. Secondly the commercial banks pyramid loans on the basis of those reserves. So normally if the Fed increases the monetary base (not typically notes and coins but more commonly by increasing the total quantity of reserves in the system held on account with the Fed itself) by 100 billion you might expect an actual expansion of the overall money supply of maybe 1 trillion (in a very simple example).”
found here https://forum.freecapitalists.org/t/the-actual-procedure-of-creating-money-alt-thread/5380
seems to be at odds with the first excerpt.
can anyone here determine which of these statements is the more true or altogether wrong?
thanks